05 September 2009

Setting the Agenda

In their book, "You’re in Charge—Now What?," Thomas Neff and James Citrin recount the time A. G. Lafley, now the former CEO of Proctor & Gamble, took over following the forced departure of his predecessor, Durk Jager.

Within days of taking the job Lafley announced his priorities. Instead of a radical makeover, he concluded initially that P & G needed to do better what it already did well. “The message was shocking in its simplicity. Everyone down the chain of command could understand it,” Neff and Citrin note.

Mr. Lafley’s priorities for P & G became the first installment of his leadership agenda. Innovation was added later.

Does the new president and CEO of General Motors, Fritz Henderson, have an agenda?

Rick Wagoner, the former Chairman and CEO created a few clear and easily understood performance targets. Wagoner laid out his agenda for North America at GM’s annual meeting some time ago. His four goals were simple and direct:

Misplaced bets on SUVs and large trucks, a global economic crisis and government intervention, however, cost Mr. Wagoner his job. This was evidently part of the price for seeking a federal bailout needed to cover huge operating costs until sales turn around.

Although some progress had been made toward these goals, what was missing in the Wagoner agenda was a greater sense of urgency. This is an important lesson for any leader facing a crisis situation.

Henderson’s agenda is to a large extent the making of others.

With GM now in bankruptcy, the new government-appointed CEO must quickly deal with:

-Returning to profitability—selling products consumers want and are willing to pay for

-Managing the political and financial tension of building smaller “green” vehicles with the demand for large (and more profitable) cars, SUVs and trucks

-Continue working with the White House Auto Task Force (cash infusions)

-Getting along with new GM board chairman, Ed Whitacre

-Building confidence in his own leadership abilities

Another vital lesson from GM’s experience: If you don’t learn to make decisions, time will make them for you.

There’s a new agenda at Starbucks. “Back to the bean,” says CEO, Howard Schultz. Mr. Schultz’s agenda, in the midst of a huge fall-off in sales due to the economy and rapidly changing consumer behavior, includes:

-Reasserting Starbucks’ position as the world’s coffee authority-Reigniting the emotional attachment with customers-Carving out new areas for growth-Closing nearly 800 stores—while opening 200 more

Will this be enough to turn around Starbucks? There are some early signs of progress.

What’s an “agenda?” And how does it help leaders accomplish their goals?

A leader's agenda is a personal plan for guiding the organization. It's not a business plan in the traditional sense. An agenda is a set of themes and priorities requiring action and progress in a given period of time. The agenda includes the main message and identifies critical issues needing attention. (Briefing for Leaders Harper Business)

“It’s not a plan or a strategy,” says Jeff Immelt, Chairman and CEO of General Electric. “It’s what you stand for, what you’re focusing on.”

What are the benefits of a leadership agenda (which also apply to nonprofits)?

1. It clarifies the main message. There was no question in the minds of those at P & G what was important to A. G. Lafley—at least initially they were going to find ways to sell more Tide.

2. It provides focus. For GM it comes down to this: Everyone needs to make sure their attention and behavior are focused on the goals determined to be crucial to GM’s future.

One criticism against Carly Fiorina, the former CEO of Hewlett-Packard, was the globe-hopping and time spent on a long list of issues. The late Peter Drucker observed that effective CEOs pick two tasks and devote their energies there. When those tasks are done they don’t go to #3. They make a new list.

While multi-tasking for executives is a reality, the discipline to focus on a few things is an antidote to “corporate attention deficit disorder.”

4. It improves organizational health. An agenda designed for action and results creates clarity and a positive climate. If people know what’s going on in the CEO’s mind they know where to place their energies. There’s no substitute for a sense of direction and a direction that makes sense.

5. Provides accountability for results. First, for the CEO. Then for everyone else. Call it follow-up, implementation or execution. It’s all the same thing. Getting the right things done.

What does an agenda look like?

A more developed but concise leadership agenda contains the following:

· The preferred future and core idea of the business. It lists the building blocks of that strategy with the concept of the business at the center.

· The main message of leadership. What needs to be said by the leader to the employees? The stakeholders? The investment community? What is the dominant message that should cascade over all these constituencies?

· The top priorities—with a clear no. 1. What should get your attention? A. G. Lafley offered a few priorities—inside a clear and simple theme. It allowed his people to move ahead with purpose.

· The critical issues needing attention. Critical issues are barriers to achieving the goals. Sometimes they are within your influence. Other times they are not—like the weather. They can be financial (as in recession), human resources, competition or government regulations.

It’s essential to have a common understanding of the issues, who is responsible for each, and how to deal with them in a timely manner.

· Operational issues. What, if anything needs changing or reorienting to support your direction? What should be abandoned? What groups need improved communication in the coming months? What rises to the top as the two or three things that must happen in the coming year?

Most people are not mind-readers. What’s inside your head needs to be made known repeatedly and in different venues among a wider audience. A leadership agenda is a simple and practical way to improve the communication process vital to your success and that of the business.